Wen Zhao's Blog

How much would it cost to establish a taxi dispatching system in a city of 20 million people, with nearly 66,000 taxis jamming the roads? Consider that Singapore, with a population of about 5 million, has spent tens of millions of dollars to build a customized system with screens and sensors installed in almost every taxi and a large-scale call center to support it.

Now with the wide availability and affordability of smartphones, entirely new innovative approaches that are light on infrastructure can be employed to reduce cost and time-to-value. A good example is a mobile application recently launched in Beijing called Didi Taxi that works like this:

Passengers and drivers download the app. There are two versions, currently available on both iOS and Android. Drivers download the app to accept orders; passengers download the app to order taxis.

Passengers bid for taxis through their mobile phones. When a passenger opens the app, they see their current location on the map and the density of available taxis nearby based on the GPS tracking on both passengers’ and drivers’ devices. Passengers then use their voice to specify their exact location and destination, and — most importantly — how much extra on top of the metered fare they are willing to pay (normally ranging from $1 to $3).

Taxi drivers confirm the booking. The system automatically broadcasts the message to all nearby taxis (within either a 1 km or 2 km radius) based on the density of nearby taxi drivers using the app. The first driver to respond within 90 seconds will get the order. If no drivers respond, the message goes out again to all drivers in a larger radius.